The European Union escalated its trans-Atlantic fight with Microsoft on Thursday, threatening new multimillion fines against the software maker over claims it fails to offer rivals a fair deal on licenses for helping servers work with Windows. In response, Microsoft charged that the treatment it receives from the EU is unmatched around the world and harmed Europe's efforts to become a thriving high-tech economy. The EU said Microsoft could face fines as high as euro3 million (US$4 million) a day, accusing the software company of trying to protect its interests by overcharging rivals for complete and accurate interface documentation - which would allow them to interoperate with Windows PCs and servers - on reasonable and non-discriminatory terms.

In fact, only a few weeks ago, most mayor elevator manufacturers that operate in the EU have been fined one billion euros (1.3 billion dollars) for violating antitrust legislation. It's very well possible Thom is referring to that very case.

That fine was handed out by the same office as the fines against microsoft. Europe just seems very keen on a level playing field. We believe in a free market, but only if it is kept really free.

Market regulations in Europe are quite sane but I don't think word "free" applies. Once you start regulation it's not free (that's my opinion on GNU licence as well ). Entirely free makret won't work well in real world.

I agree. People use the word free in cases where things are regulated. Truly free means the good AND the bad are in full spades. When you try to regulate what you consider "bad", it is no longer truly freedom.

Totally agreed. Moulinneuf - remember one thing, US citizens are so enamoured of the capitalistic 'dog eats dog' way of business that they see any other way as being wrong.

Regulation is fine. Let me put forward an example, if these people think that regulation is bad, then let's release all of the criminals (murderers, rapists etc) from jail, since holding them in jail is just a form of regulation. Let chaos occur. Does that sound right?

Regulation is fine. Let me put forward an example, if these people think that regulation is bad, then let's release all of the criminals (murderers, rapists etc) from jail, since holding them in jail is just a form of regulation. Let chaos occur. Does that sound right?

And you realise that those of us who are of the libertarian persuasion, that is, Neo-Classical Liberal, the states sole purpose is the protect private property and defend the country - that is it.

Microsoft is dominant in the desktop market space - why? because the competition have come up with no viable alternative that can be dropped in to replace Windows.

The problem with your suggestion is that by human nature (and human greed), if left unchecked, it will soon be ALL bad and there'll be no good. That's the way business (and greed and money) work I'm afraid.

That depends on your definition of freedom. Freedom can either be defined negatively or positively. The negative definition concerns itself to limits on it (i.e. the limits on your freedom so it does not impinges on others). The positive definition of freedom relates to the availability of opportunities that are given to a person. Giving someone an education increases their freedom, because it gives them more opportunities to succeed, for example.

That's what I meant when I said Freedom is a loaded word, which can be used (and misused) in many ways. I think we agree on this.

I think free market has more to do with balance of power so its reasonably fair for new entrants to have a chance against the established players. If the market was not regulated, it would become non-free because control of the market would become centralized in the hands of a few entities.

It would be an interesting experiment to see, though, whether an unregulated market would correct itself, and by centralizing control of a market, these entities lose touch with budding sub-markets (see Microsoft and Linux) and eventually fail as the sub-markets overtake the previous ones.

Of course, in a completely free market, Microsoft would have no antitrust penalties, and Linux would be under no patent threat. So I would guess that you're right in saying that an unregulated market (hypothetical) would = free, and externally influencing a market to maintain freedom is unncessary.

I think free market has more to do with balance of power so its reasonably fair for new entrants to have a chance against the established players. If the market was not regulated, it would become non-free because control of the market would become centralized in the hands of a few entities.
Free market as an economic term is very unrealistic because it's based on insane assumptions like instant knowledge spread, perfect supply and demand ratio and so on, it forgets about the fact that wealth is not evenly distributed at the starting point. We can only try to get close to it with regulations. Freedom would mean anarchy and I don't think that ideology has lots of supporters
People had a taste of more free market during industrial revolutions period but we all know how it ended, very big fortunes of few people and exploitation of labour force that lead to rise of communism.
Question if Linux could compete well with Windows in a really free market is very interesting though because it's a very different kind of competition.

It would be an interesting experiment to see, though, whether an unregulated market would correct itself, and by centralizing control of a market, these entities lose touch with budding sub-markets (see Microsoft and Linux) and eventually fail as the sub-markets overtake the previous ones.

I think this is exactly what has happened. AFAIK the EU didn't even think of punishing MS for anti-trust violations until the Clinton DOJ came up with the idea; it may well be that the de-fanging of the DOJ under Bush on the issue simply made room for other forces to do the job the DOJ should have been doing.

Of course, in a completely free market, Microsoft
would have no antitrust penalties, and Linux would be under no patent threat. So I would guess that you're right in saying that an unregulated market (hypothetical) would = free, and externally influencing a market to maintain freedom is unncessary.

Hmm...In the US, Microsoft are under no *significant* antitrust penalties (In the same way that a peanut is significant to the sun). And Linux is under NO patent threat. So I guess that the US is a completely free market. And guess what, it isn't self-correcting. Microsoft just squishes everything, aided by the US Chief Economic Advisor to the Whitehouse.

That fine was handed out by the same office as the fines against microsoft. Europe just seems very keen on a level playing field. We believe in a free market, but only if it is kept really free.

*giggle*

Maybe I'll believe that once Nanny state in the EU stops providing agricultural hand outs to Pier and Luigi who insist on running commercially unviable farms by over producing products that have a low profit margin.

Maybe once I see the EU get its house together, in reference to the so-called 'freemarket' that you talk about, I might then take the motives of the EU authorities as genuine rather than simply than a refuge for pathetic companies likes Adobe, Real Networks and Sun who insist on pissing and moaning about Microsoft and yet keep pushing out inferior products.

Real Networks with its compulsory registration when it comes to downloading their free player, and once installed the crap that is spewed around the hard disk is akin to the spyware/adware drive programmes out there. Sun and its crappy attempt to bring OpenSolaris and OpenOffice.org/StarOffice kicking and screaming into the 21st century but trying to do it by spending no money on development at all. Adobe and their anti-UNIX agenda of failing to port their applications to other platforms and make their PDF software competitive, and yet moans when Microsoft provides a superior replacement (XPS) and licences it under a much more favourable licencing terms than PDF is.

Don't let jingoisms fool you; for something to be done in the EU, companies have to lobby; too bad the EU can't step back and realise that this is simply a long story in the shit storm that is Microsoft vs. the crappy sore losers who can't scrape together a competitive product to compete against Microsoft.

Maybe I'll believe that once Nanny state in the EU stops providing agricultural hand outs to Pier and Luigi who insist on running commercially unviable farms by over producing products that have a low profit margin.

Maybe once I see the EU get its house together, in reference to the so-called 'freemarket' that you talk about, I might then take the motives of the EU authorities as genuine

No, one is a fixed amount where as a tax break can only go as high as the amount of tax paid; if they spend $4billion on something, and only pay $3billion in tax, they're down by $1billion, they can't recoop that extra $1billion spent.

Subsidies are normally done on a per-employee or per-unit produced basis resulting in a steep rate of over production.

There had to be a frame of reference for your comment on the EU, otherwise it is meaningless. By what yardstick where you comparing the EU, in your original criticism?

in many cases, they aren't subsidies but tax breaks - you know what a tax break is? compare the two, then come back and chat.

The difference between the two, especially in the cited context, is minimal. Not only that, but the US has agricultural subsidies of its own. Many countries do.

The problem with the word "freedom" is that it's such a loaded term it can easily be misused. Freedom without rules is basically the Law of the Jungle. We don't want that for persons (i.e. we should not have the freedom to steal or harm others), I don't see why it should be any different in the corporate world.

There had to be a frame of reference for your comment on the EU, otherwise it is meaningless. By what yardstick where you comparing the EU, in your original criticism?

I'm not comparing it anything at all, just looking at the judgement as an isolated incident with no comparison to any other country.

Yes, Microsoft used strong armed tactics to gain marketshare and Microsoft haven't denied that fact, what they have denied, which I agree with, is that it is part of normal practice when it comes to business.

You have hard nose negotiations and ultimately if the OEM agrees to sign a lower priced contract resulting in a lower cost per unit *BUT* it means that there are restrictions based on what can be put on the desktop - aka, Microsoft is now the sole 'advertiser' on their hardware, whose fault is it? if someone came up to me and offered me a house for $200,000 *BUT* if I wanted to purchase it for $20,000 the only clause was that I couldn't sublease the extra rooms to suppliment my mortgage, who in the end makes the choice? I have the choice there to either save $20,000 or accept the extra freedom I might enjoy by paying the extra amount.

The OEM's chose to enter those contracts and I certainly don't blame Microsoft for these OEM's deliberately restricting their own choice when it came to operating systems and what can be loaded on them - if these OEM's had a pitch of foresight, they would have said, "no" to the exclusive contract, absorbed the extra cost so that when an alternative did arise, be it BeOS, Linux, FreeBSD/PC-BSD or what have you, they were in a position where they could pre-load it without restrictions or preload applications onto their Windows based machines without restrictions.

The difference between the two, especially in the cited context, is minimal. Not only that, but the US has agricultural subsidies of its own. Many countries do.

Incorrect; there are tax breaks all the time; the US technology industry is merely a biproduct for tax breaks relating to R&D and yet I don't here you complain about that apparently 'corporate welfare' that occured; infact, YOUR very hobby/job is a biproduct of those tax breaks.

A subsidy is different, it is a cash in hand transfer - its the equivilant of me going up to you and giving you $200 in the hand - what are you going to do? of course, you're going to waste it, it was simply money given to you with out any work, on the other hand, a tax break is a tax rebate or tax credit (which ever terminology you feel confortable with) where by you can only get back as much as you would have otherwise paid in tax, meaning, it caps yours spending resulting in less waste; sure you can spend more on R&D but at the same time you know that you can't spend anymore than the amount of tax you would have otherwise paid.

The problem with the word "freedom" is that it's such a loaded term it can easily be misused. Freedom without rules is basically the Law of the Jungle. We don't want that for persons (i.e. we should not have the freedom to steal or harm others), I don't see why it should be any different in the corporate world.

Yes, Microsoft has the freedom to offer multiple OEM contracts, and the OEM vendors have the freedom to choose which one they wish to go with - they made the choice of going with the restrictive one; thats freedom, and part of freedom is responsibility for the choices we as individuals or corporations make.

I don't *care* what decisions people make, I just don't want them coming back, going through the legal system, using the system as a way of backing out of decisions they made and instead of taking responsibility for the decision, blaming the other party for a decision made by them alone.

Maybe you should geta clue. Just for your info, the US subsidizes way more farms in the US that the EU does. Why you brought that up I dont know, but I thought you should know.

As for the EU, they had one simple instruction. Provide documentation on your protocols because you are a monopoly. Pretty simple to do. And MS has done anything but. Dont believe me? Where are the press releases from the SAMBA team about Windows interoperability? How about AD? NTFS? .doc and .xls? They havent openned anything. PDF is at least an open standard.

I dont care that MS is the at the top. Its the fact that they broke the law time after time to get there that pisses me off. If Windows was so great, it could compete on its merits alone and then MS wouldnt be in court all the time. But instead MS does anything it can to keep Linux down. Why do you suppose that is? Surely if we are a bunch of losers then MS doesnt have anything to worry about. Right?

Uh, they know that they don't have a very strong moat around their dominant position. But the evil things that you say they are doing (i.e. being a monopoly), are not so clearly evil until you get into such a position. Everyone tries to be king of the hill and the tactics necessary to get there are perfectly legal until you reach the pinnacle, and then they become illegal. In such a situation, there is no real incentive to aim for the top... to grab it all.

There needs to be some method of stabilizing the market. Some way to ensure that once you've come out with something good, you'll be able to profit from it for a while. If there is none of this "economic rent," then there's incentive to produce good stuff and take risks, because even if you succeeed, you're feeding your neighbors cow since everyone will have this technology you developed.

The EU judgement was never about Open Source and OSS will never get royalty-free licensing to the Windows protocols. What even makes you think it's fair for them to? Microsoft hasn't (and will not) pursued them for reverse-engineering the systems, but MS has no reason to help them, because truly free high-quality software will destroy their business utterly.

This won't necessarily lead to a better situation for customers either. If people aren't out there making money on systems, the quality of the products will suffer and sooner or later no high-quality systems will even be available. The linux kernel is excellent, and certain pieces of linux are doing very well. But some of the areas that really matter to users won't be developed for free. And no one can make money by developing core system components for linux, so ultimately the boring and hard stuff needed to make a good user experience will always lag.

What does this have to do with the EU? Well, the case is mostly about American competitors to Microsoft over there. And some OSS people who want to stick it to Microsoft, but have no intention of really producing a better product with it: they just want to cannibalize small pieces of Microsoft's share. When you want Microsoft to "compete by the merits alone," do you consider that maybe the structure of AD or NTFS, or .xls are part of their respective programs' merits and could contain some valuable intellectual property on how to implement a particular kind of system? There is no law on the book that says that any product a firm makes must be interoperable with any other. There are laws preventing the creation of monopolistic positions to close competitors out of your market. But the four formats you mentioned above were developed for markets which Microsoft was not dominant in at the time. And they were not designed simply to lock competitors out, but to allow their software to do its job. What do you want? Before they try to even enter a new market, they should give out full docs for everything they plan to their competitors?

I wouldn't be surprised if Microsoft just stopped selling their OSs in Europe

You are in great error when you think Microsoft, however big they are, or they think they are, could permit themselves to pull out from a market as large as Europe. A company is just as big as their shareholders allow it to be. Loosing a market is not a move any shareholder would see as being good. And, btw, Microsoft is big because we pay them. When money stops, business stops.

I wouldn't be surprised if Microsoft just stopped selling their OSs in Europe if these people continue to insist that you have to give your rivals the keys to your business to do business in Europe.

Europe is the real Microsoft's cash cow. If they would stop selling their products, the biggest loosers would be Microsoft shareholders, hence it's close to impossible.

It's time for Microsoft to leave enough room for competitors on just about any computer/software related market IMO.
Anybody would benefit of that (third party devs, end users....).

Plus, there is a simple thing to know. When Microsoft sells its products in the EC it accepts without any special treatment or privilege the EC rules. It works a bit like you accept Microsoft's rules (EULA) by installing/using their products.

Now if they really misbehaved and abused of their monopoly, Microsoft has to pay, period ! Nobody cares if Microsoft is american, chinese or french.

I normaly don't reply to dumb comments, but I just have to...."these people"?! Another one with "here be dragons" area on your map, aren't you? Population of EU equals close to 500 million people, meaning way larger market than US. It's not even about "key" to business, it's about controling the market, do read some basics of economy and business, pay attention to market types and especialy to what a "monopoly" (not 100% in this case though) does to products, business and development/inovations.

I wish someone would make a calculation/scenario about what impact the hold on selling OS to EU would have on Microsoft and US economy. Oh, and I rather have EU being really strict and fine wrongdoers than to have a government/system that acts like a marionete to huge lobbies.

Oh, and I rather have EU being really strict and fine wrongdoers than to have a government/system that acts like a marionete to huge lobbies.

I support the EU's actions in effect, but I'm a bit concerned about the principles. The US government is over-responsive to big corporate lobbies, while the EU government is over-responsive to small corporate lobbies. I could argue that the latter is potentially more devastating to consumers.

I hope that one day our governments realize that the consumer lobby is the most important one of all. We're the ones paying most of the taxes, living paycheck to paycheck, and getting screwed by big business. The solution isn't protecting (somewhat) smaller businesses, the solution is protecting consumers.

We're being sold computer systems loaded with software for which nobody is willing to provide adequate documentation. We are being sold products where we would have to pay megabucks for exclusive and non-transferable rights to learn how to use them. Sure, this is screwing ISVs. But it's screwing consumers more than anyone else.

I wouldn't be surprised if Microsoft just stopped selling their OSs in Europe if these people continue to insist that you have to give your rivals the keys to your business to do business in Europe.

Microsoft can't do that, they would lose almost half of their market. And Europe wouldn't stop using computers. Instead they would starting using other software (either Linux, Mac OS, or something completely different). This would help the competition beyond imagination, and show the rest of the world how to live without Microsoft.

I wonder if this would even be an issue if Microsoft was an European business instead of an American one.

Don't worry, Microsoft no longer holds the record for the largest fine. Recently a fine of 992 million was give for anti-competitive behaviour in the lift business.

Sorry, but I guess Microsoft earns lots more money on sales in the EU. It's not the EU's problem that the United States didn't achieve to domesticate bad playing Microsoft, because of political intervention.

And what is so silly about enforcing written laws? If Microsoft wants to earn money here, they have to obey local laws.

Half of the stuff you mention is absolutely moot when you consider what innovation actually matters to people out there. Sure L4 and Minix and all those OSS projects are cool and can be used to make great low-level hardware stuff. But the overwhelming majority of the world doesn't give a hoot about the structure of their kernel or the syscall interface or the underlying DBUS or HAL systems in KDE. They ask the question, "What will I be able to do with it that I couldn't do before?"

Besides Google and in some ways Mac (and not really the OS but the whole package), none of the products you mention allow non-nerds to do anything new (that's cool, at least). So in the most important sense, they're not innovative.

The difference is that cigarettes kill people, whereas having a dominant position in the software industry doesn't lead as surely to death and large healthcare costs for the state. Also, Windows is non-habit-forming. No one is really urged to use windows. They do have an urge to use applications though.

Ms likes to play lip service when it comes to documenting protocols and interfaces.

They are all for 'standards' when the standard is theirs or its the software they sell that is the 'defacto standard' but other than that, forget about it.

This company was required to divulge certain technical interfaces to the operating system to do business in that part of the world (the EU) and they keep trying to get around the issue with half-@ssed attempts.

I'm glad someone has the balls to keep hammering them until they comply. I'm a US citizen who has profited greatly from MS and I don't see a problem with what the EU is doing here.

So you don't read much, do you? You just look at the page count and if it's too high, you determine what's inside is useless?

The 8000 pages are for all offered protocols. You'd only read them all if you intend to implement every one of the avilable protocols. The 1500 pages of pricing documents covers the exact structure for pricing as agreed by MS and the EC. It contains several options including a standard price list, a price list based on new revenue you gain after using the protocol(s), and the option to negotiate directly if the documented pricing standards still don't meet the needs of your organization.

The problem with your accusation is you do them anonymously on OsNews , why don't you try the same in the EU courts ?

Says the other guy posting anonymously on OS News. Unless the EC succeeds in trying to extend its dictates outside the boundaries of the EU, I have no reason to go before their courts. Judging from their current and previous rulings, it wouldn't matter if I did anyway.

I ain't anonymous I use my real life name. The problem is not so much as if your under there jurisdiction but the fact that you lie about them , but you refuse to face them directly.

I already read your spin on reality , and answered it , if you don't get it that 1 page or 1 billion page of documentation on something don't let you achieve the project or compatibility then the documentation is not complete , I guess your unable to participate in this discussion and should be disregarded.

Don't project yourself and what you normally do on me , if I get documentation on something I read it all , so that I can learn and educate myself from it. If after implementing the protocols with the Microsoft documentation it still fails to be compatible , then Microsoft tried to circumvent the law and sold some crap. That's it.

Right, that's why the EU constitution is being universally hailed as the most significant literary-political achievement evah.

NOT.

IIRC the 8,000 pages, including references to obligatory conformance to the behaviour of obsolete programs, is judged by many to be about 7,850 pages too long.

What's half-assed is the EU's rulings that are never clearly defined as to how MS should achieve compliance, and change arbitrarily so they can get more money out of MS.

Ah yes. Fortunately, those outside the Church of Microsoftology realize that MS's complaints about having to follow the law are just typical MS grandstanding and propaganda about circumstances that wouldn't have happened in the first place if they had just got off their arses and followed the f--king standards in the first place instead of acting like they are as much above EU law as they are apparently above US law.

Those who mod up the kind of drivel written by OP should be thoroughly ashamed of their ignorant selves.

They have gone to India because indian programmers work overtime for a ridiculous salary, without a real social security or a decent health system. Probably the Indian state does not make much money off Microsoft, which helps India keep their piggybank empty of cash and the streets full of hungry people. Yeah, and it helps Microsoft become more profitable too.

Actually, few of Microsoft's roughly 71,000 employees are Indian, and most of those are for Indian localization and support. A little over 44,000 are in the US (about 33,000 on the "campus" alone), with the remaining amount being distributed around the US and among about 100 international offices. These numbers aren't very hard to find, and are easy to Google up.

Whatever Microsoft may be doing, paying third-world wages for first-world work isn't among them.

Microsoft seem to have a policy of fighting every case every inch of the way right on to the bitter end. Perhaps they just see it as a cost of doing business.

This move by the EU is not unexpected or surprising. It's the next step in a case that's been dragging on for ages already. The ball has been in the EU's court for a few months and now they've knocked it back. The EU aren't going to walk away; they are very serious about trade and competition policies.

Microsoft's recent deal with Novell may not have helped. It may have emboldened Microsoft to think that it's worth stonewalling the EU since if they spread enough FUD around, then their competitors - the folks who want interoperability - will cave in and make agreements on the side anyway, agreements which won't involve legal oversight and are bound to be to Microsoft's advantage. Just a thought.

Page 3 : Having regard to Council Regulation No 17 of 6 February 1962, First Regulation
implementing Articles 85 and 86 of the Treaty1, and in particular Article 3 and Article 15(2)
thereof,

Having regard to the complaint lodged by Sun Microsystems, Inc. on 10 December 1998,
alleging infringements of Article 82 of the Treaty by Microsoft and requesting the
Commission to put an end to those infringements,

Page 300 :

Article 2
Microsoft Corporation has infringed Article 82 of the Treaty and Article 54 of the EEA
Agreement by:
(a) refusing to supply the Interoperability Information and allow its use for the purpose of
developing and distributing work group server operating system products, from
October 1998 until the date of this Decision;
(b) making the availability of the Windows Client PC Operating System conditional on the
simultaneous acquisition of Windows Media Player from May 1999 until the date of this
Decision.

That's actually quite good. Microsoft is VERY good at creating obstacles in interoperability. Be it in servers area or desktops - hell, even Offices on Mac and Windows display things differently and measure cells differently and such. There are millions of examples there. So however much the fines are... let's hope MS will use this as a lesson and FIX the software instead of babbling about innovation being stifled and economies failing. It's a pity so many people have to use Windows and the rest of the world may go to hell and be screwed in MS interpretation.

The us would be doing the same thing if we had any real representation. But alas the same corporate monopolies that our legislators are supposed to rein in are putting hush/lobby money into their pockets. I think we should stop paying taxes....no taxation without representation!

Microsoft has proved in the past that it can operate outside the law and writes off legal fees as a business expense. Look at the Netscape vs MS case, the BeOS vs MS case, etc etc etc. They simply just keep the case going until their opponents cave in or go broke.

Interestingly they have taken this to government level (and basically "lobbied" the US into submission) and now the EU. We are seeing one of the ugly side of massive multinational corporations, they are already operating outside the law but the only way to coax them into getting close to complying with the laws of the market they are operating in. If you fine them too much they just tie everything up in legal procedures as it is cheaper than paying the fine then go for a settlement later. The motivation is that the EU (in this case) can't be seen to not be able to enforce the law, so they will not settle.

There is a limit however and this is the line MS is walking and if you humiliate a government or in this case a collection of governments too far they will have to respond to stop looking as if they are no longer in control. This could have much larger implications for MS financially.

The EU is a huge market for MS, they are not going to abandon it. This has nothing to do with MS being american, it might have something to do with MS dicking around with the EU in the past and they will not be too appreciate about that.

Oh wait, this is OSNews better include a screenshot, hmm, ah I will put screenshot in large letters and put a summary for the hard of attention...

SCREENSHOT: If the EU tries to fine them too much they will legally stall it, too little they will ignore it. Just right and it will motivate them to sort it out as it is cheaper than the legal fees.

“The Windows API is so broad, so deep, and so functional that most ISVs
would be crazy not to use it. And it is so deeply embedded in the source
code of many Windows apps that there is a huge switching cost to using a
different operating system instead. [...]
It is this switching cost that has given customers the patience to stick with
Windows through all our mistakes, our buggy drivers, our high TCO, our
lack of a sexy vision at times, and many other difficulties. […] Customers
constantly evaluate other desktop platforms, [but] it would be so much
work to move over that they hope we just improve Windows rather than
force them to move.
In short, without this exclusive franchise called the Windows API, we
would have been dead a long time ago.”579
“The Windows franchise is fueled by application development which is
focused on our core APIs”